Viewership drop: No deterrent for TV advertising

TV is still one of the highest reached media and has been an integral part of brands' growth journey, contend industry heads

by Javed Farooqui
Published - September 05, 2022
5 minutes To Read
Viewership drop: No deterrent for TV advertising

TV continues to be the primary mode of advertising for a large number of clients notwithstanding the challenges being faced by the broadcast industry. Experts note that TV is trusted by advertisers due to the reach that it offers. They also add that TV advertising is reasonably priced and has helped brands to drive up consumer demand. Furthermore, TV helps in brand-building due to the credibility that it enjoys.

TV advertising has continued strong despite the growth in digital content consumption and the implementation of the New Tariff Order (NTO) has impacted the broadcasting sector. Add to that, the drop in overall TV viewership has led many to believe that TV might lose its position as the primary vehicle of advertising to digital sooner than expected. Furthermore, most industry reports have projected that digital is expected to overtake TV in ad spends this year.

Speaking to analysts after the Q1 FY23 results, ZEEL MD and CEO Punit Goenka noted that the TV AdEx growth will bounce back in the coming quarters. "In terms of the advertising revenue outlook, TV continues to remain a powerful proposition for brands, providing massive reach at the most competitive price point. Large FMCG players drew a positive co-relation between advertising and promotional spends, and volume growth during the quarter," he stated.

Parle Products Senior Category Head Krishnarao Buddha said marketers are increasing their ad spends on digital since consumers are spending a lot more time on digital. That said, TV continues to be an important medium for Parle along with digital. "TV continues to rule advertising despite all the challenges but there is a slow and steady movement towards digital. We will continue to focus on TV and digital," Buddha said.

As for Mindshare South Asia CEO Amin Lakhani TV AdEx will not see any impact due to a drop in viewership. According to him, the decline in TV viewership has happened on the back of two factors – cord-cutting and power cuts.

"I don't think TV advertising will get impacted because it is still one of the highest reached media. It is also efficient at the same time. It has delivered for brands and has been an integral part of the brands' growth journey. Clients spending money on TV have seen results in terms of sales seeing an uplift. I don't think clients are going to forget that in a jiffy," he stated.

Wavemaker India Chief Client Officer and Office Head - North & East, Mansi Datta, noted that TV was still the medium that delivers the highest reach. TV, she added, reaches out to almost 90 crore individuals. "The gap between TV and any other media is still a very wide one with a gap of minimum 200 million audience base," she added.

Sharing insights on the shift to digital, Dentsu-owned Amplifi’s Chief Investment Officer Sujata Dwibedy said that subscriber churn from TV to digital was a reality but that does not mean that audiences are not viewing the TV content. She noted that consumers are viewing broadcast content through Connected TV. In order to capture this behavioural change, Dwibedy suggests that there should be a unified measurement system.

"Unless we have a unified metric system it is very difficult to explain this behavioral change. The shift is mainly in the metros, in tier 2 and tier 3 towns or rural, the TV penetration is still growing. FTA channels have a huge viewership, regional channels are not seeing this kind of drop either. So, the hypothesis can be that this is more of a metro phenomenon," she elaborated.

While stating that loyal viewers still consume content on TV, Dwibedy pointed out that the light viewers and binge-watchers are the ones moving away from TV. "Also, with OTT and screen agnostic viewing, individuals in single TV households now have their freedom of viewing on other screens, that impact is visible in the drop."

Zenith SVP & National Head - Media Buying Ramsai Panchapakesan said, "As per BARC India there are 890 million TV viewers are available and the change is consumers are very conscious and NTO has facilitated them to choose the channel which is their favorite to save the subscription cost. This is an evolving state of content consumption and once FTA opens up later this year, there could be a possibility that the overall TV viewing universe may go up. However, the time spent on television has come down marginally and has also resulted in a drop in overall television GRPs. Still, the reality and format shows are performing and attracting the light and medium viewers on linear channels."

DDB Mudra Group Managing Partner Rammohan Sundaram said it was natural that the ad revenues will get impacted due to a drop in viewership. He, however, believes that certain properties like the Indian Premier League (IPL) will not see much impact. "I have said this many times in the past and believe that unless there is an equally powerful impact property IPL will rule the roost. Therefore, brands will need to prioritise their investments depending on their objectives and budgets."

Parle's Buddha stated that fiction properties deliver better ROI compared to non-fiction properties. "High-impact properties are not delivering the ratings even as sponsorship costs are rising. We would rather invest in regular soaps which give us assured GRPs at a decent CPRP. So why should we go for properties that have exorbitant CPRPs?" he questioned.

Madison World Chief Buying Officer Vinay Hegde believes that the ad spending on TV will not take a hit. He also stated that the demand will dictate pricing for broadcasters, especially during the festive season.